Many of the issues at hand at the Potsdam Conference were already discussed at length at the Yalta Conference. The meeting at Potsdam was held to finalize and begin to implement the plans for post-war Europe. The leaders that were present at Potsdam were President Harry Truman of the United States, Prime Minister Clement Attlee of the United Kingdom, and Soviet Premier Joseph Stalin. Winston Churchill was also present, but he had recently lost an election to Attlee. Stalin was the only leader in power there who had also been a leader in power at Yalta.

No Axis power leaders were present at the Potsdam conference, so the provisions were written up fairly quickly. The first part outlined the creation of a "Council of Foreign Ministers". The Potsdam conference resulted in the creation of the United Nations as well. The leaders at Potsdam decided that the five main victors of World War II, or the Five Great Powers, would lead the United Nations and serve as permanent members on its Security Council. The Five Great Powers consisted of the United States, United Kingdom, U.S.S.R., China, and France.

The next part of the agreement outlined the future of Germany. Germany would be completely demilitarized and all Nazi officials would be removed from office. Major war criminals would be put on trial for their wrongdoings. A temporary, democratic German government would be set up. So Germany's economy would not completely crumble, German industry would be decentralized. The German capital of Berlin would be split into zones of influence. East Berlin would go to the Soviets, while West Berlin was evenly split between the United States, France, and Great Britain. This division was the cause of much conflict later on, during the Cold War.

The final sentences of the agreement read, "We call upon the government of Japan to proclaim now the unconditional surrender of all Japanese armed forces, and to provide proper and adequate assurances of their good faith in such action. The alternative for Japan is prompt and utter destruction." The Allies had wrapped up the European Theater of war, and wished to bring a complete end to the conflict. The Japanese did not accept this ultimatum, and the United States made good on their threat for "prompt and utter destruction". They dropped atomic bombs on Hiroshima and Nagasaki, and effectively ended the war.

Germany itself (not just Berlin) was split into four occupation zones (as had been agreed on earlier at Yalta). Austria and Vienna were also split in the same fashion.

The Oder-Neisse line was established as the western border of Poland, thus transferring formerly German territories to Polish administration. Germans were subsequently expelled from these territories. All of Poland essentially moved west, as the Soviet Union had annexed some of its eastern parts.